Each one in plain English, with the numbers worked through for a shareholder.
24 Feb 2009capital raising announcement● NeutralMajor
On February 20, 2009 Apollo signed a US$70 million project loan with RMB Australia Holdings, RMB Resources and Macquarie, drawable until June 30, 2009, replacing the December 2008 bridge loan. The loan bears interest at LIBOR plus 7% and has a US$3,465,551 arrangement fee, with repayments in instalments from September 2009 to March 2013. Proceeds fund Black Fox development, up to US$7 million of corporate costs (US$3,723,939 used to repay the non-RAB convertible debentures), and repayment of US$15,341,345 under the bridge loan. The lenders get about 34.8 million more warrants at Cdn$0.252 for 48 months, on top of the 42.6 million bridge warrants. If all are exercised, RMBAH and Macquarie would hold 14.88% and 18.54%. Apollo must also deliver 250,420 ounces of gold forward at a weighted average of $876.063 and hedge Canadian dollar costs equivalent to $60 million. Haywood is owed shares and 2,567,901 warrants at Cdn$0.256. Apollo also paid RAB's accrued interest in shares: 2,444,765 shares issued February 24, 2009. This resolves the bridge loan and funds the Black Fox build, at the cost of heavy security, hedging and dilution.
On February 16, 2009 Apollo agreed with RAB Special Situations, the largest holder of the February 2007 convertible debentures, to extend RAB's US$4,290,000 of debentures from February 23, 2009 to February 23, 2010. Apollo may pay RAB's US$772,200 of accrued interest in shares or cash. In return RAB gets 2,000,000 shares and its 8,580,000 warrants are extended to March 5, 2010 with the exercise price cut from US$0.50 to US$0.25. The other US$3,148,100 of debentures is unchanged and still due February 23, 2009. This resolves part of the open debenture thread but adds dilution.
This amendment only fixes a typo in the December 31, 2008 filing, changing the share count from "3,000,0000" to 3,000,000. The terms of the Cdn$900,000 flow-through placement are otherwise unchanged.
On December 31, 2008 Apollo closed a flow-through placement of 3,000,000 shares at Cdn$0.30 for Cdn$900,000, to be spent on Black Fox exploration. It paid MAK Allen & Day a Cdn$40,500 finder's fee and Haywood a Cdn$36,000 advisory fee plus 255,000 warrants at Cdn$0.30 for 24 months, and must register the shares for US resale within 45 days. The price is well below the Cdn$0.50 paid in the August 2008 flow-through placement. That comparison is the writer's own observation, not the filing's.
What it means for a shareholder
3.0m new shares at C$0.300 to raise about C$900,000. Shares on issue before the raise aren't in the record, so the dilution can't be worked out.
16 Dec 2008capital raising announcement● NeutralMajor
On December 10, 2008 Apollo signed a US$15 million bridge loan with RMB Australia Holdings, RMB Resources and Macquarie Bank. Only US$6 million can be withdrawn now; the other US$9 million needs lender approval, which the lenders will not give unless Apollo raises equity or other funds for corporate costs before February 28, 2009. The loan carries a 5% arrangement fee, interest at LIBOR plus 10%, and matures on the earlier of June 30, 2009 or the first draw on a long-term project loan. It is secured by a first lien on substantially all assets including Black Fox, and may only be used for Black Fox and related fees. The lenders also received 42,614,254 warrants at Cdn$0.221 for 48 months, and interest can be paid in shares instead of cash at the lenders' option. This is new financing for the Black Fox build and adds dilution.
Apollo Gold repaid US$1.95 million of the US$4.79 million still outstanding to RMB Australia ahead of schedule, funding it by unwinding part of its gold hedge. Cutting debt in the middle of the 2008 crash, at the cost of the price protection the hedge provided.
29 Aug 2008material agreement termination● Neutral
This amendment only corrects the lender's name in the August 27, 2008 filing to RMB Australia Holdings Limited (it had said "RMB Resource Inc."). The facts are unchanged: the US$1,654,000 September 2008 instalment was repaid early on August 22, 2008, using US$1,556,000 from unwinding lead and zinc hedges plus US$108,000 of cash, and US$5.1 million is still owed on the July 2008 extension.
On August 22, 2008 Apollo paid off the US$1,654,000 September 2008 RMB loan instalment early, using US$1,556,000 gained from unwinding its lead and zinc hedges plus US$108,000 of cash. It still owes US$5.1 million on the July 2008 extension. The filing says the unwind was a debt management decision because the contracts' value was near the amount owed. This reduces the original October 2007 facility to nothing outstanding on its own terms.
26 Aug 2008capital raising announcement▲ GoodMajor
On August 21, 2008 Apollo closed the flow-through placement: 17,000,000 shares at Cdn$0.50, raising Cdn$8.5 million, which is larger than the 14 million shares first announced. The money is for the Black Fox open pit pre-strip and other exploration. Haywood received a Cdn$55,250 commission and options on 1,020,000 shares at Cdn$0.50 for 18 months, and the buyers get resale registration rights. This completes the August 6 announcement.
On August 6, 2008 Apollo announced a bought-deal private placement of 14,000,000 flow-through shares at Cdn$0.50 for Cdn$7 million, plus an over-allotment option for 3,000,000 more (up to Cdn$1.5 million). The money is for the pre-strip of the Black Fox open pit and Canadian exploration spending there, with closing expected around August 21, 2008.
30 July 2008asset acquisition disposition▲ GoodMajor
On July 28, 2008 Apollo completed the Cdn$20 million purchase of St Andrew's Stock Mill complex near Timmins by paying the final Cdn$14.6 million, and it must also refund about Cdn$1.2 million of bonding to St Andrew. About Cdn$14.6 million came from the unit offering that closed July 24, 2008, with St Andrew buying about Cdn$1.2 million of units. The rest came from the RMB loan and working capital. The filing says Apollo weighed the cost and timing of building a new mill for Black Fox against buying this one. This resolves the mill purchase thread.
On July 22-23, 2008 Apollo changed the unit offering so the agents' 6.5% commission is paid only in cash and their options are locked up for 180 days. It also let St Andrew buy up to 2,400,000 units (Cdn$1.2 million) and resell an extra 2,400,000 of its shares. Apollo agreed to pay the remaining Cdn$14.5 million for the Stock Mill within two business days of the offering closing.
On July 9, 2008 Apollo signed an agency agreement with Haywood and Blackmont for a best-efforts public offering of units at Cdn$0.50, each with one share and a half warrant exercisable at Cdn$0.65 for 36 months. The offering has a minimum of Cdn$20 million and a maximum of Cdn$40 million, with proceeds for the St Andrew mill, Black Fox development and working capital. Agents get a 6.5% commission and options on 6% of the units, so this could add materially to the share count.
On July 1, 2008 Apollo expanded its RMB facility with an additional US$5.15 million loan, bringing the amount owed to US$6,804,000 (from US$1,654,000). It is mainly to fund the Cdn$4 million Stock Mill payment. The new money costs LIBOR plus 2.0% and is repayable in instalments to June 30, 2009. It is now secured by all assets of MTMI and Apollo, including Black Fox. Apollo pays a US$100,000 fee and issues 650,000 shares to RMB, and hedged about 50% of its Montana Tunnels share of expected output for Q4 2008 and Q1 2009 with gold, silver, lead and zinc collars.
On June 30, 2008 Apollo and St Andrew amended the mill purchase: the Cdn$18.5 million balance is now due as Cdn$4 million on July 3, Cdn$6 million by July 31 and Cdn$8.5 million by August 29, 2008, with no further extension and 12% interest on the unpaid balance. The final payment may be made partly in shares at Cdn$0.50 if St Andrew stays below 20%. Failure to meet closing conditions would forfeit the payments already made.
On June 6, 2008 Apollo agreed to buy St Andrew Goldfields' Stock Mill complex near Timmins, Ontario for Cdn$20 million, paying a Cdn$1.5 million deposit now and Cdn$18.5 million at closing, expected June 30, 2008 (extendable to August 29 with 12% interest). St Andrew owned about 17.5% of Apollo, and Apollo also takes on a roughly Cdn$1.2 million bonding commitment. This is a new step in developing Black Fox; the filing does not say how the balance will be funded.
On October 31, 2007 Apollo closed a Canadian private placement of 7,454,545 flow-through shares at Cdn$0.55, raising Cdn$4.1 million. The money is earmarked for Black Fox drilling, permitting and a feasibility study, which addresses the open Black Fox funding and feasibility-study thread. Underwriter Haywood received a Cdn$225,500 commission and options on 5% of the shares (372,727 shares by calculation) at Cdn$0.55 for 18 months, and the buyers get resale registration rights, so more shares will be added to the count.
On October 12, 2007 Montana Tunnels Mining entered a facility of up to US$8 million with RMB Australia Holdings, at LIBOR plus 1.25%, repayable in four quarterly instalments from December 31, 2007 with final maturity September 30, 2008. Proceeds must first go to repaying the Series B secured debentures (the November 2004 trust indenture), and the facility is secured by the Montana Tunnels shares and assets, guaranteed by Apollo and Apollo Gold, Inc., and later by the Black Fox assets once the debentures are repaid. To meet loan criteria Apollo hedged lead and zinc with no-premium collars, covering about 65% and 40% of its share of the next 12 months of production respectively. This addresses the open thread of the Series B debentures due November 2007, but replaces them with a shorter, covenant-bound loan.
On October 12, 2007 Apollo announced a private placement financing in a press release attached as an exhibit. The exhibit text is not included in the filing provided, so the size, price and terms cannot be stated here.
On October 4, 2007 Apollo settled indemnification claims from Jipangu relating to the 2005 sale of the Florida Canyon and Standard mines. Apollo agreed to pay US$650,000 for the leach pad and tax claims, and to reimburse employee disability claims when and if damages exceed US$200,000. It had reserved US$600,000, so about US$50,000 more will be expensed in the quarter ending September 30, 2007. This settles claims arising from the 2005 Nevada disposals.
On July 2, 2007 Apollo released a new Canadian-standard (NI 43-101) estimate for Black Fox near Timmins, prepared by SRK Consulting: 4.47 million tonnes of probable reserves at 7.0 g/t, or 1,002,000 ounces of gold, based on a gold price of US$525 per ounce. There are also indicated and inferred resources beyond the reserves. The filing says Black Fox reports no reserves under the US SEC standard because a bankable feasibility study has not been completed. This is a reserve estimate, not a funding or construction decision, so Black Fox development funding remains an open thread.
26 Feb 2007capital raising announcement● NeutralMajor
On February 23, 2007 Apollo completed a private placement of US$8.58 million of convertible debentures due February 23, 2009. They pay 12% interest for the first year and 18% after that, and are convertible at US$0.50 per share. Each US$1,000 of debentures also carries 2,000 warrants at US$0.50 for two years. Regent and Shoreline received about US$600,000 in commissions plus compensation warrants at US$0.50, and the company agreed not to sell securities for three months without their consent. Apollo can force conversion after September 24, 2007 if the 20-day average share price reaches US$0.90, or on a change of control. Existing holders face dilution from the conversion shares and warrants, and the shares underlying them must be registered for resale. Unit purchasers from the November 2006 offering used their participation rights in this deal.
On January 17, 2007 the board adopted a shareholder rights plan, with one right issued per common share. If anyone acquires 20% or more of the shares (outside a permitted bid), other holders can buy shares at half market price, which heavily dilutes the acquirer. The filing says it was not adopted in response to any takeover proposal, and it runs to January 17, 2012 unless ended earlier. This is a takeover defence that gives the board more time to consider an unsolicited bid; it does not change the shares themselves unless triggered.
On December 31, 2006 Apollo's Montana Tunnels subsidiary amended its joint venture with Elkhorn Tunnels. Elkhorn signed a promissory note for the unfunded part of its US$13 million contribution (about US$3.7 million at December 31) and committed to pay it in cash by January 17, 2007; delivering the note earned Elkhorn its 50% interest in the mine. The note carries 24% interest if unpaid after January 17, and if not fully paid by February 17, 2007 Elkhorn loses its disproportionate share of cash flow. The press release says Elkhorn had contributed US$11.0 million by January 4, leaving US$2 million due, and that mill start-up is estimated for late February or early March 2007. This continues the open question of whether Elkhorn completes its funding; half the mine is now Elkhorn's, with payment still outstanding.
On December 1, 2006 Apollo refinanced the US$2.64 million Great American truck note with an 18-month equipment lease from Marquette Equipment Finance, total cost US$2.3 million, at US$125,143 per month. At the end of the term Apollo can buy the four trucks for 15% to 30% of US$2.3 million (no more than 25% if all payments are made). Apollo also granted Marquette a security interest in seven other CAT 785 haul trucks. This replaces the August note, which was due December 1, 2006.
Apollo Gold completed the 16,688,206-unit offering at US$0.30 on November 8, 2006, as announced in October, for roughly US$5 million gross. Each unit has one share and a half warrant at US$0.50 for three years; Shoreline Pacific was placement agent. This resolves the open US offering and adds shares and warrants to the count.
On October 30, 2006 Apollo Gold closed a Cdn$1 million flow-through placement (2,222,221 units at Cdn$0.45) for Black Fox exploration. It also agreed to sell 16,688,206 US units at US$0.30, each with a half warrant at US$0.50 for three years, expected to close around November 15, 2006. US unit proceeds are for Black Fox development, Huizopa exploration and working capital. The US warrants have a full-ratchet clause, so selling shares or options below US$0.50 would cut their exercise price, and the company agreed not to issue common shares for 90 days after closing. The filing says the deal adds new shares and warrants, so existing holders are diluted.
On July 28, 2006 Apollo's subsidiary agreed a joint venture on the Montana Tunnels mine with Elkhorn Tunnels, LLC (a Calim Private Equity affiliate). Elkhorn is to put in US$13 million over five months, mainly to fix the east wall instability that suspended mining on October 21, 2005, and earns a 50% interest once fully paid. Apollo also gave Elkhorn Goldfields a two-year option to buy the Diamond Hill mine for US$0.8 million and a two-year option to buy the Diamond Hill mill for US$1 million, plus a milling agreement. Separately, on August 1, 2006 the subsidiary issued a US$2.64 million note to Great American Group at 1.5% per month, maturing December 1, 2006, to buy four haul trucks. This gives Apollo partial outside funding for the Montana Tunnels restart but gives up half the mine if Elkhorn completes its contribution.
Shareholders approved an amended stock option plan on May 24, 2006. Options are capped at the lesser of 10% of issued shares or 12,139,686 shares (the old plan allowed 4,805,904), option grants to insiders are limited to 750,000 per year, and the plan must be re-approved every three years. The larger cap means more potential dilution from options.
Apollo Gold signed the Severance Agreement and Release with each of the four departing executives (Miller, O'Neil, Young, Vagstad) as of February 18, 2006. This completes the severance arrangements announced in January. The filing gives no new amounts.
